Chapter 48 complicated way

complicated way Three years later, the chair and professor of population studies and economics is sitting in the window-facing corner of his office, overlooking Stanford University's boulevards.He admits he still hasn't quite figured out what happened in Santa Fe."As time went on, I grew to appreciate Santa Fe's ideas and concepts. But I think the Santa Fe story continues," Arthur said. Most fundamentally, he said, he came to realize that the Santa Fe Institute would be a catalyst for a lot of change.Without the Santa Fe Institute, these changes would have always happened, but much more slowly.Of course, the economics research program is exactly that.After he left, the project continued under the auspices of David Lane of the University of Minnesota and John Geanakoplos of Yale University. "By 1985 or so, it seemed that economists of all stripes were exploring new approaches, looking around and searching, feeling that the conventional economic theory that had ruled for the past three decades had reached its limits. The old theories It has prompted them to explore in depth the problems that can be explained by static equilibrium analysis methods. But the conventional theory ignores the problems of process, evolution and pattern formation. In these problems, there is no equilibrium at all, the continuous emergence of accidental factors, historical events It's a big deal, but adaptation and evolution are inexhaustible. Of course, the study of these problems was in trouble at the time, because economic theory cannot be a theory until it can be fully expressed in mathematical form. Everyone only knows how to balance But some of the best economists have felt that the study of economics must break out in another direction."

"What the Santa Fe Institute did was to be a great catalyst for all this change. At the Santa Fe Institute, many of the great minds in economics, many of the top minds like Hann and Arrow, were able to work with Talented people like Holland and Anderson interacted with each other. They talked to each other for a period of time and realized: Yes! We can use inductive learning methods, not necessarily deductive logic methods. We can cut through the dilemma of equilibrium. The evolution of pointing to openness, because other disciplines have already carried out research on this kind of problem. Santa Fe provided the technical basis and support urgently needed in the field of economics such as special terms, metaphors, expert consultation, etc. for this research. But more importantly Yes, the Santa Fe Institute legitimized this new view of economics. Because when people hear that people like Arrow, Hahn, and Sargent are writing these kinds of academic papers, they think that other It’s perfectly reasonable for people to act like that.”

Arthur could see this unfolding at every economics conference he attended these days.“There have always been people who have been interested in questions of economic process and change,” he says. Indeed, as early as the 1920s and 1930s, the great Hungarian economist Josef Schumpeter pioneered many of these basic concepts. "But my feeling is that in the last four or five years, people with this mindset have grown in confidence. They don't have to apologize for being able to give only verbal and qualitative descriptions of economic change. Now they have In full gear, the study of economic process and change has formed a thriving movement and is becoming part of mainstream economics."

Arthur said the campaign certainly made life much easier for him.His once unpublished theory of increasing rate of return now has followers, and he is invited as a respected scholar to give academic reports on various occasions and far away. In 1989, he was invited by Scientific American to write an article on increasing returns for the magazine. "It's the thing that makes me the happiest," he said.This article was published by the journal in February 1990, making him one of the recipients of the 1990 Schumpeter Prize for Best Research in Evolutionary Economics. But for Arthur, it was Arrow's September 1989 assessment of Santa Fe-style economics research that he was most grateful for.At the time, Ken Arrow was speaking at the end of a week-long economic symposium, the largest to date.But ironically, Arthur basically didn't hear what Arrow was saying that day.He said he sprained his foot badly when he was walking out of the chapel door to lunch at noon that day.He spent the afternoon in pain in the chapel-turned-conference room for the closing ceremony.Kaufman bandaged his sprained foot, and there was a bag of ice cubes on the chair in front of him.Arrow's closing speech didn't hit him like a thunderbolt until days later.Against the advice of his doctors, colleagues and wife, he limped to Irkutsk, Siberia, for a long-planned meeting.

He said: "It was like a flash of light across the sky at three o'clock in the morning. Just after the plane landed in Irkutsk, a man was riding a bicycle on the runway, waving a light stick in his hand, showing us Where are the taxis. Suddenly, I thought of what Arrow said in his closing speech, and it suddenly dawned on me. Arrow said at the time: 'I think we can now safely say that we have another economy We already have an economics, conventional economics that we are all familiar with. He is modest enough not to call it the Arrow-Debre system, but he refers to Basically neoclassical economics and general equilibrium theory. 'Now we have another kind of economics, Santa Fe-style evolutionary economics.' He made it clear that, for him, this year's Progress has shown that this is another valid way to study economics, and its importance is equal to that of traditional economic theory. This is not to say that conventional economic theory is wrong, but that we have explored a new method. This The new method is suitable for the study of economics outside the conventional method. Therefore, this new method is a supplement to the usual economics. He also said that we do not know that this new economics will bring us Where it's going. It's just the beginning of this research. But he found it very interesting and very exciting."

"These words from him excite me immensely," said Arthur. "But Arrow also had a second meaning. He compared the Santa Fe study with the Cowles Foundation study. He's been with the Cowles Foundation study since the early 1950s Keeping in touch. I was pleasantly surprised to hear his comment that the Santa Fe study, which is less than two years old, seems to be more accessible at the moment than the Cowles Foundation study at the same time. I feel greatly honored. Because the members of the Cowles Foundation project team are all young figures in economics today. Among them are Arrow, Coopermans, Debnot, Colin (Klein), Hervey Hurwicz and others. Four of them have won the Nobel Prize, and several others are on the podium for the Nobel Prize. They are the big figures who used mathematics to standardize economics, and formulated it for generations to come. The man who broke the norm was the man who actually led a revolution in the field of economics."

From the Santa Fe Institute's perspective, catalyzing a sea change in the field of economics is just one part of their effort to catalyze a revolution in complexity across the scientific community.Their quest may have turned out to be a dream, but Arthur believed that George Cowan, Marie Gell-Mann, and others had pinpointed the most important questions. “People who aren’t scientists always think that science is deductive,” he says. “But science is mostly metaphorical. What’s happening now is that a certain kind of metaphor has changed in people’s minds.” Looking back, imagine What changes have taken place in our mind's view of the world since Newton appeared. "Before the seventeenth century, the world was trees, diseases, human minds and actions, a world that was at once chaotic and organic. The heavens were still complex, and the orbits of the planets seemed arbitrary and incomprehensible. Imagine an artistically The world. Then Newton came along in the 1660s. He devised a few laws, he devised differential calculus, and suddenly the planets seemed to be moving in simple and predictable orbits!"

"Until now, Newton still has an unimaginable profound influence on people's hearts." Arthur said. "Heaven, the dwelling place of God, can already be explained by us. We don't need angels to rule things anymore, we don't need God to rule things anymore. So, without God, this century becomes more secular However, when we face poisonous snakes, earthquakes, storms and plagues, we are still desperate to know who is in charge of them all. So, during the Renaissance from 1680 to the entire eighteenth century, people's beliefs turned to The Supreme Cult of Nature: If you let things take their course, nature will take care of making everything work out for the common good.

The clockwork movements of planets, Arthur says, became the metaphor of the eighteenth century: simple, regular, predictable, Newtonian machines that run on their own.This reductionist science, which would later dominate for two and a half centuries, became Newtonian physics. "Reductionist science would say: 'Hey, the world is complicated and messy. But you see, you just need these two or three rules to reduce all of this to an incredibly simple system!'" Arthur said: "So, the rest depends on Adam Smith. Adam Smith discovered the hidden mechanism behind the economy in Edinburgh, the peak of the Scottish Renaissance, and published "The Wealth of Nations" in 1776. (The Wealth of Nation). In which he argues that if people are left free to pursue their individual interests, the 'invisible hand' of supply and demand will be responsible for making everything work in the direction of the common good." Clearly , this is not the whole story.Smith himself identified vexing issues like worker alienation and exploitation.However, the simplicity, power and correctness of his Newtonian economic views have made him the dominant Western economic thought ever since. "Smith's ideas were so great that we all fell in love with them. A long time ago, the economist Kenneth Boulding asked me: 'What do you want to do in economics?' When I was young In a huff and without humility, he replied: 'I want to push economics into the twentieth century.' He looked at me and said, 'Don't you think you should push it into the eighteenth century first?'”

Arthur said that he felt that all science was no longer naive, while twentieth-century economics was thirty years behind.For example, at the beginning of this century, philosophers like Russell, Whitehead, Frege, and Wittgenstein came out to prove that all mathematics is based on simple logic.They were only partly right.Much mathematics can indeed be based on simple logic, but not all.In the 1930s, the mathematician Kurt Godel showed that even certain very simple systems of mathematics, like arithmetic, are incomplete.Their systems always include statements that cannot even be logically proven to be true or false.The logician Alan Turing showed at about the same time (and using the same rationale) that very simple computer programs also hesitate.You can't know in advance whether the computer will provide an answer.By the 1960s and 1970s, physicists were drawing the same conclusion from chaos theory: that extremely simple equations can produce surprising and unpredictable results.The same truth keeps being demonstrated in field after field, Arthur said. "It is recognized that logic and philosophy are chaos, language is chaos, chemical dynamics is chaos, physics is chaos, and therefore economics are chaos. This chaos is not created by microscopic dust, It's inherent in the systems themselves. You can't grab them and confine them to a clean box of logic."

The result was a revolution in complexity science.Arthur said: "In a sense, this revolution is against reductionism. When someone says: 'Hey, I can start with this extremely simple system, and look, it produces such complex and unpredictable results', the revolution in complexity science begins." Complexity theory is not based on the metaphor of Newtonian mechanized prediction, it seems closer to the metaphor of a tree growing from a seed to a towering tree, or like a computer program Starting from a few lines of code, maybe even a group of simple-minded birds, organically and self-organized.This, of course, was the metaphor Langton had in mind for artificial life.His whole point is that complex, life-like behavior is the result of a few simple bottom-up rules.This metaphor also had a big impact on Arthur's economics research program at Santa Fe. "If I had a purpose, or a point of view, for this project, it was that I wanted to show that a chaotic and thriving economy emerges from a theory that is astonishingly simple and elegant. That's why we created these simple The reason for the stock market model. These stocks will become very emotional, there will be a crash, or the stock market will skyrocket completely unexpectedly, like understanding some kind of human nature.” Ironically, Arthur, while at the Santa Fe Institute, had little time to focus on Langton's artificial life, the theory of the edge of chaos, and the postulated new second law.The economics project has taken up 110 percent of his time.But he had heard about the theories and found them fascinating.For him, the artificial life theory and these other theories are some kind of basic ethos of the institute.Arthur said: "Martin Heidegger once said that the most fundamental philosophical question is existence. What are we doing as conscious entities? Why isn't the universe just a mess of colliding particles? Why does it exist? Structure, shape, and pattern? Why does consciousness exist?" Few at the Santa Fe Institute have explored the question of existence as directly as Langton, Kaufman, and Farmer.But Arthur felt that everyone was approaching the problem from different directions. Moreover, Arthur felt that these ideas resonated strongly with the problems he and his colleagues were working on in economics.For example, when you look at the problem through the lens of Langton's phase transition, neoclassical economic theory suddenly transforms into a neat assertion that the economy is embedded in the realm of order and that markets are always In equilibrium, if things change, they change slowly.And the Santa Fe point also translates into a simple assertion that the economy exists on the brink of chaos, that economic actors are constantly adapting to each other, and that things are always in flux.Arthur had always known which assertion was closer to reality. Like other Santa Fe members, Arthur was hesitant to contemplate the wider implications.The ideas of this school are still immature, and it seems that it cannot justify itself, and it sounds too easy to think that this is a new age thing.But like everyone else at the Santa Fe Institute, Arthur couldn't help thinking about the wider implications. You can look at the complexity revolution almost theologically, he said. "Newton's metaphor of mechanized movement is close to orthodox Protestantism. This metaphor holds that the universe is basically in order, and we do not depend on God to create order. This is somewhat biased towards Catholicism. It means that God arranged the world, And as long as we follow the rules, order will naturally exist. If each of us performs our own responsibilities, pursues our own legitimate rights and interests, works hard, and does not disturb others, then the world will naturally tend to balance. Then we can maximize the realization of Our own interests, our due interests. It may not be theological to say that, but it is my impression of Christianity." "The other theoretical choice—the characterization of complexity—is entirely Taoist. In Taoism, order is not inherent in nature, 'the world begins with one, becomes two, and then becomes many, many Many leads to infinity.' In Taoism, the universe is vast, indeterminate, and ever-changing. You cannot crucify it. Although its elements never change, they are always reorganizing themselves. So this It's like a kaleidoscope: the meaning of the world lies in the model and change, although everything in the world has repetitions, it can never be exactly the same, and the world is always new and different." "What is our relationship to the world? We are made of the same elements as the universe. So we are part of a universe that is both unchanging and eternally changing. If you imagine yourself as a bird If you're a boat going upstream, then you're kidding yourself. You're just the captain of a paper boat going downstream. If you try to go upstream, you're just going to stay where you are. On the other hand, if you Being very good at seeing where the flow is going, and realizing that you are a part of it, and that the flow is always changing, always approaching new complexities, it's easy for you to use your pole to navigate one eddy after another." "But what does that have to do with economics and political policy? In terms of policy, it means watching, watching, watching, and occasionally throwing a boat in the river and making improvements. It means, you try to See reality for what it is, and realize that the game you are playing in is always changing, so you need to figure out the rules of the game at hand. This means that you are watching the Japanese like a hawk, and you are no longer naive, and you are no longer interested in them. Demand justice, stop adhering to orthodoxy based on outdated rules of the game, stop saying: 'As long as we can achieve equilibrium, we can live in a rich capital.' You are just watching. When you find that effective action can be taken, then Take action." But be aware, says Arthur, that this is not passive waiting, nor is it fate. "It's a powerful way to use the natural nonlinear dynamics. You don't waste energy, you use limited power to maximize the effect. This is the difference between the South Vietnamese method and the North Vietnamese method during the Vietnam War. , Westmoreland resorted to heavy artillery attacks, gillnets and villages burned, while the North Vietnamese were like the ebbing tide. But three days later, they came back, and no one knew them Where did it come from. This is also the rule implicit behind all Eastern martial arts: You don't stop your opponent's attack, but let them come at you, and when he comes at you, look for the opportunity to give him a deadly blow. One hit. The idea is to observe and then strike decisively, with the right timing." Arthur is reluctant to delve into the policy implications of this view.But he does remember a small seminar that Marie Gell-Mann urged him to co-chair before he left Santa Fe in the fall of 1989.The purpose of this symposium is to explore how complexity science can be integrated into the economics, environmental values ​​and policy making of a region.For example, in the Amazon River Basin, because of the construction of roads and farms, the rainforest is being cut down at an alarming rate.Arthur's response during the workshop was that there are three levels of policy that should be considered for rainforests (or anything else). The first level is the conventional cost-return approach: how much does each particular action cost, what is the return, and how do you maximize your return on investment?"There's a grain of truth to that assessment," Arthur said. "It forces you to figure out what each of the alternatives means. Of course, at the workshop, there were some people arguing about the cost versus return of the rainforest. The problem is, this approach Generally speaking, it is assumed that all problems have been clearly defined, various options have been clearly defined, and political arrangements have been made. Therefore, the job of the analyst is only to calculate the costs and benefits of various options. It's as if the world were a railroad yard: we're all on the same track, but we can use dispatch switches to steer trains onto other tracks." Unfortunately, for conventional theory, the real world doesn't always look like As we've defined it, especially on environmental issues.Objective cost-benefit analyzes are often the result of hasty and arbitrary subjective judgments, and zero points for things that no one knows how to evaluate."I poke fun at this type of cost-benefit analysis in discussions where the 'benefit' of keeping spotted owls is how many people come to the forest and how many people get to see spotted owls and see these spotted owls," Arthur said. owls are good for them, etc. It's just a big joke. The cost-benefit analysis of this environment looks like we are in the window of nature and say: 'Well, we want this, this , and this.’ But we’re not insiders ourselves, we’re not part of it. So I’m not interested in this kind of research. It’s too bossy, too arrogant to ask how nature works for human beings.” The second level of analysis is entirely institutional and political.Arthur said: It's about figuring out who did what and why. "For example, once you start doing an analysis of Brazilian forests, you find all kinds of actors: landowners, settlers, ranchers, politicians, rural police, road builders, indigenous people. They're not the ones making decisions about environmental issues , but they are all the main characters in this sprawling and interactive game of Monopoly, largely influencing the environment. Moreover, the political system is not something outside the game, but the result of the game, various alliances and factions It’s all born out of that.” In short, Arthur says, you have to look at the system as a system, the way a Taoist in a paper boat looks at a complex, ever-changing river.Of course, that is the instinctive way a historian or a statesman looks at the situation.Recently, some excellent research in economics has also been started from this perspective.But at the 1989 seminar, the idea seemed new to many economists. "I put a lot of emphasis on this idea in my conversations," Arthur said. “I tell them, if you really want to go deep into environmental issues, you have to ask yourself these questions: how much is this related to who, what kind of alliances will be formed, what kind of basic situation will be formed. Then you Maybe a breaking point for possible intervention will be found." Arthur said: "All of this leads to a third level of analysis. At this level, we can look at how two different worldviews analyze environmental issues. One is the traditional equilibrium view that we have inherited from the Renaissance to the present day. .This point of view holds that the relationship between man and nature is dichotomous, and there is an equilibrium point that is most beneficial to mankind between man and nature. If you believe this point of view, then you are discussing 'optimal decision-making of natural resources', which is Words I heard from one of the original speakers at the seminar." "Another perspective is the complexity perspective. It is the perspective that there is basically an inseparability between man and nature. We are part of nature. We are part of it and there is no distinction between doer and affected because We are part of this interlocking web. If we humans act in our own favor without understanding how the whole system will adjust for it, like cutting down the rainforest, then we will set off a cascade of things that will Things will likely turn around and force us to adapt in different patterns, like global climate change." "So once you drop the dichotomy, then the problem changes. You can't talk about optimality because it becomes meaningless. It's as if the parent had to find the optimal way to behave in opposition to the child. .If you look at your own home as a family, it’s a weird idea. You can only talk about co-existing and adapting and what’s best for the family.” "What I have said is basically nothing new to Eastern philosophy. Eastern philosophy has always regarded the world as a complex whole. This worldview has become It is becoming more and more important. People's concept is very slowly changing from the exploitation of nature, that is, the opposition between human beings and nature, to the coexistence of man and nature. Our vision of the world begins to get rid of childishness and become mature. When we To understand complex systems is to begin to understand that we are part of a kaleidoscopic world of perpetual change, mutual constraints, and nonlinear motion." "So the question is, how do you act in a world like this. The answer is, you keep as many options open as possible. You choose viability and what works, not what you call 'optimal'. Many people will Ask this: 'Didn't that make you choose the lesser solution?' No, you didn't. Because maximizing profit is no longer a well-defined definition. What you're trying to do in a world of uncertainty become stronger and more survivable in life. This in turn enables you to learn as much as possible about nonlinear relationships and the role of chance. You observe the world with extreme care and do not expect that the current situation will never change. Change." So, what role does the Santa Fe Institute play in all of this?Certainly not another policy-making think tank, though that always seemed to be expected, Arthur said.No, the role of the Santa Fe Institute is to help us observe this eternally flowing river, to help us understand what we are looking at. "In truly complex systems, there are no identical patterns, but some common themes are recognizable. For example, you can speak of 'revolutions' in history in general terms, although this revolution may be different from that revolution. Quite different. That's why we use metaphors. In fact, many policymaking has to rely on good metaphors. Conversely, bad policymaking is always associated with inappropriate metaphors. For example, comparing anti-drugs to ' War', which conjures up images of guns and military assault, may not be appropriate." "So, from that point of view, the purpose of having the Santa Fe Institute is to have an institute like this be a place to create metaphors and vocabularies for complex systems. If someone does a really brilliant study on a computer , you can say: 'We have a new metaphor. Let's call it the edge of chaos.' Or whatever. So what Santa Fe did was, after doing a good job of studying complexity systems , telling us what models of observation there are, and what metaphors apply to systems of eternally changing, ever-evolving complexity, rather than telling us what metaphors apply to mechanical motion." "So I think the smart thing to do is to have the Santa Fe Institute do the science," Arthur said. “Turning it into a shop selling policies would be a huge mistake. It would devalue the meaning of Santa Fe and ultimately turn it into the opposite. Because what is currently lacking is an understanding of how complex systems work. This is the main task of scientific research in the next fifty to one hundred years." Arthur said: "I think doing this kind of research has something to do with personality. The people who do complexity research are people who like process and models. They are the opposite of people who are used to stagnation and order. I know that in my life In , whenever simple rules create an emergent, complex chaos, I can't help but say, 'Ah, that's great!' I think that sometimes other people back off when they see that." Sometime around 1980, he said, while he was still wrestling with his ideas about dynamic, evolutionary economics, he happened to read the geneticist Richard Lewontin of a book.He was shocked by one of the words.Levantin said that there are two kinds of scientists.The first type of scientist sees the world as basically balanced.If some untimely force pushes the whole system slightly out of equilibrium at one point, they feel that, overall, the system will still return to equilibrium.Levantin dubbed scientists who held this view "Platonists" because Plato, the Athenian philosopher, claimed that the chaotic and imperfect world around us was nothing but shadows of perfect "archetypes." The second type of scientist, on the other hand, sees the world as a process of flow and change, of the same matter repeating itself in endlessly different combinations.Levantin called these scientists "Heracliti-ans" because the Ionian philosopher Heraclitus passionately and poetically determined that the world was in a state of flux and constant change. among.Hearst, who predated Plato by almost a century, is famous for observing that "you step into the same river, but it flows through different currents".His words were interpreted by Plato as: "A man cannot step into the same river twice." Arthur said: "These words of Lewontin were an inspiration to me. I finally realized everything around me. I thought, we have finally woken up from Newton's theory."